ActivIdentity Reaches Out to Managed Security Service ProvidersActivIdentity Reaches Out to Managed Security Service Providers
ActivIdentity is gearing up to help managed security services providers offer its authentication and credential management solutions on a subscription basis. Here are some quick details about the effort.
January 20, 2010

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ActivIdentity is gearing up to help managed security services providers offer its authentication and credential management solutions on a subscription basis. Here are some quick details about the effort.ActivIdentity this week announced a strategy for letting MSPs “create, manage and authenticate digital identities in the cloud,” as Grant Evans, ActivIdentity’s chairman and chief executive officer, put it. ActivIdentity doesn’t provide a cloud service. Instead, it offers the back-end infrastructure software that MSPs use to deliver strong authentication or credential management in the cloud, according to a company statement.
Other companies have taken a services tack on authentication. CryptoCard offers Crypto-MAS, a managed authentication service that the company says leverages cloud computing. Alliant Technologies and CSC also provide managed authentication services.
ActivIdentity’s interest in MSPs reflects its new go-to-market approach. During the company’s Q4 earnings call in November, Evans said the company was seeking to complement its exiting pricing model — perpetual licenses — with subscription-based pricing. The company intends to expand its distribution channel in the MSP space to assist with that push.
ActivIdentity currently points to two publicized MSP partnerships: EDS (now HP Enterprise Services) and BT. The HP business unit used ActivIdentity’s ActivID Card Management System to “deliver a cloud computing service to the U.S. General Services Administration Managed Service Office,” according to ActivIdentity.
The company described its arrangement with BT as “still in a pilot phase.”
Beyond that, ActivIdentity is a bit guarded in discussing its MSP pursuit. When asked how many managed security services providers the company plans to recruit, ActivIdentity responded as follows:
“As a public company, we don’t share any forward looking information, which includes planned quantity of additional Managed Security Service Providers.”
Nevertheless, ActivIdentity seems to be looking to MSPs for a subscription-revenue boost, a key element of the company’s strategy this year.
During the Q4 call, Grant said the subscription-based model will provide ActivIdentity with a more predictable revenue stream. He said the company’s goal for 2010 is to establish a business platform that can sustain double-digit revenue growth in the long term.
In the short run, the subscription approach could help the company at a time when customers are deferring capital spending.
ActivIdentity’s revenue for the quarter ended September 30 was $14.5 million compared with $15.6 million for the year-earlier period. For the full fiscal year, the company generated revenue of $62.3 million compared with $59 million in 2008. The company narrowed its net loss in 2009 to $5.5 million from $76.5 million the previous year.
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